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GAO discussed six states' implementation of the Carl D. Perkins Education Act, focusing on the extent to which targeted federal vocational education funds adequately serve the special populations and program improvement funds further specific activities. GAO found that: (1) federal emphasis shifted from maintaining outdated vocational education curricula to improving and modernizing local programs and increasing targeted groups' participation; (2) localities provided programs and services for the special groups and for program improvement consistent with the act; and (3) state efforts to use act funds to improve vocational education programs was also consistent with the act. GAO also found that: (1) some vocational education students in economically depressed areas were less likely to receive funding for improved or modernized program activities than students outside such areas; (2) some states designated relatively wealthy areas as economically depressed and provided greater funding to those areas than to some poorer communities; (3) the allocation formula for disadvantaged populations shifted some funds from the poorer communities because it included nonpoor academically disadvantaged students; and (4) states could reallocate disadvantaged and handicapped population funds returned to the states by some eligible recipients from poorer to wealthier communities. GAO believes that the Department of Education should: (1) require states to substantiate their criteria for designating areas as economically depressed and analyze their reasonableness; and (2) provide leadership to complete a national vocational education data system.